The Bottom Line / Levying tax on competition
Dalia Itzik. When a local manufacturer fails to compete with imports, it runs to the Trade and Industry Minister and complains of "dumping" (the sale of imports at below-cost price).
Dalia Itzik. When a local manufacturer fails to compete with imports, it runs to the Trade and Industry Minister and complains of "dumping" (the sale of imports at below-cost price). Clearly it is very difficult to substantiate such claims, but if the ministry wants to protect the local manufacturer, then it declares that there is indeed dumping and slaps an extra duty on the offending imports. But what happens if the ministry officials fail to find evidence of dumping? No problem, because they have another weapon up their sleeves, known as "the safety tax," which is then up to the minister's consideration. Want to help a manufacturer? Slap on the tax. Don't want? Then forget the tax.
This week, the minister slapped on a "safety tax" of $30 per cubic meter on imported plywood so that the local plywood plants could compete "honestly against the unfairly-priced imports, which come to Israel from China." Who exactly determines what are "unfair prices"? Is a cheap pencil, a cheap shirt or a cheap television set from China unfairly priced? They certainly look pretty fair to the consumers who benefit from the low prices.
Itzik tries to place herself as a leader of the plywood factories and their workers, but what will happen now to local manufacturers of kitchens, office furniture, tables and closets? They will be forced to cut back, to fire and to shut down, because their raw imports have become more expensive. But who will count the carpentries that will close and the workers who will lose their jobs? Certainly not Dalia Itzik.
Pensioners. The Finance Ministry's capital markets division is angry at the Histadrut pension funds which upgrade their pensions according to the CPI only when the upgrade wage addition is paid, and when it isn't paid in an orderly fashion, as has happened in recent years, then it doesn't upgrade and the pensions are eroded. The problem is that the treasury is not interested in correcting the distortion as it should. It seeks an alternative formula, which would also erode the value of the pensions. The solution is simple - monthly linkage of pensions to the CPI, no fancy tricks.
Ariel Sharon. The Prime Minister was a hero this week. He reaped rewards from every direction when he threw Shas out of the government. He won applause and popularity as the majority of the population thought they had finally got rid of an anti-Zionist party that preaches parasitism, living without work and without army service.
But Sharon is not made of revolutionary material. He is not the one to establish a secular government to carry through the necessary reforms in the economy and society. All he wants is to complete his term of office quietly, without doing anything for state security or for society.
Sharon does not understand that Shas will continue to blackmail, will continue to fight the emergency program, will continue to damage the economy and then present itself as the champions of the poor. And they certainly won't forget the humiliation of their dismissal, so Sharon might as well start counting down his days.
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